The last five decades have witnessed many macro-economic developments both within and outside the United States. The monetary and banking policies and the external situation have influenced the evolution of the banking in different ways. For this reason, it would be useful to analyze, in some detail, the development of banking with reference to some distinct phases.

The first phase covers the period from 1948 to 1968, the second phase from 1969 to 1990 and the third phase, 2000 onwards. These first two phases constitute the past. The period of banking reforms beginning with 2000 onwards may be regarded as the present or the current phase for the purpose of this analysis.

When analyzing the broad structure of banking industry in the United States, many things stand out. The main objective of the study is to set up the ground and logic for the analysis of efficiency. Scores of banks in the country has gone bust due to mismanagement and a lack of emphasis on the efficiency parameter.

Consider the situation in the beginning of the 2000 decade. Banks the worked solely on the profit motive started giving out loans of phenomenal amounts without doing a background check on the ability of the borrower to repay. Projects that were solely based on the speculative approach got cleared and they received funding through loans from the major banks.

The burst of the housing bubble led to phenomenal changes in the economy. Real estate speculators that have taken loans of phenomenal sizes from the leading banks are to be blamed for the crisis in the American financial sector. No one ever imagined that a crisis of such a proportion would engulf the country and that too at short notice.

The prominent banks collapsed like a pack of cards and many of the small players went bust or had to make significant realignments with other players to stay afloat. Even in such a situation firms like LoanMax of rod aycox fame could stay afloat mainly due to the fact that they adhered to high quality standards.

The last five decades have witnessed many macro-economic developments both within and outside the United States. The monetary and banking policies and the external situation have influenced the evolution of the banking in different ways. For this reason, it would be useful to analyze, in some detail, the development of banking with reference to some distinct phases.

The first phase covers the period from 1948 to 1968, the second phase from 1969 to 1990 and the third phase, 2000 onwards. These first two phases constitute the past. The period of banking reforms beginning with 2000 onwards may be regarded as the present or the current phase for the purpose of this analysis.

When analyzing the broad structure of banking industry in the United States, many things stand out. The main objective of the study is to set up the ground and logic for the analysis of efficiency. Scores of banks in the country has gone bust due to mismanagement and a lack of emphasis on the efficiency parameter.

Consider the situation in the beginning of the 2000 decade. Banks the worked solely on the profit motive started giving out loans of phenomenal amounts without doing a background check on the ability of the borrower to repay. Projects that were solely based on the speculative approach got cleared and they received funding through loans from the major banks.

The burst of the housing bubble led to phenomenal changes in the economy. Real estate speculators that have taken loans of phenomenal sizes from the leading banks are to be blamed for the crisis in the American financial sector. No one ever imagined that a crisis of such a proportion would engulf the country and that too at short notice.

The prominent banks collapsed like a pack of cards and many of the small players went bust or had to make significant realignments with other players to stay afloat. Even in such a situation firms like LoanMax of rod aycox fame could stay afloat mainly due to the fact that they adhered to high quality standards.